Despite widespread criticism of Cook’s visit in the European and Israeli press, many Brussels diplomats believe it usefully highlighted the most symbolic obstacle to the Middle East peace process: Jewish intransigence over settlements on Palestinian land.

The Union has repeatedly called on Israelis to stop building in East Jerusalem at Har Homa. Yet there is a cross-party consensus in Israel that the city should never be divided, apparently defying commitments under the Oslo agreement and a United Nations Security Council resolution.

The key now, say diplomats, lies in a new American proposal which includes calls for Israel to withdraw from 13% of the West Bank over the next 12 weeks, in return for increased Palestinian security.

The Israeli government’s decision this week to reject the proposal publicly, even though it had not been officially tabled, has placed Washington in a difficult position. Some US officials feel that tabling the plan formally now could undermine efforts to reach a settlement, while others insist that Washington’s credibility as the main sponsor of the peace process is at stake and that it should press ahead.

If the US chooses to confront Jerusalem head on, it could legitimise increasing European criticism of Netanyahu’s government and forge a more cohesive transatlantic approach to the Middle East.

Given the political sensitivities, officials are unwilling to pre-empt the foreign ministers’ discussions next Monday (30 March), although they say it is premature to talk of sanctions. But ministers are likely to reiterate the EU’s new strategy for the region, outlined by Cook earlier this month, to reflect the almost 2 billion ecu Europe has ploughed into the country since 1993.

The Union is calling for a faster redeployment of troops, has offered practical European technical support for Gaza airport and seaport, and wants to step up its diplomatic role in the region.

The question now is whether Cook has made the third objective impossible to achieve. Despite earlier pessimism, there are growing signs that it could still be met. UK Premier Tony Blair, who gets on well with Netanyahu, is planning a follow-up visit to Israel next month.